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High Court confines scope of the Independent Commission Against Corruption's powers

Yesterday the High Court of Australia upheld the decision of the New South Wales Court of Appeal that the Independent Commission Against Corruption (ICAC) does not have power to investigate allegations that Ms Cunneen counselled a person to lie to police. The majority of the High Court agreed that the alleged conduct did not amount to 'corrupt conduct' under the Independent Commission Against Corruption Act 1988 (NSW) (ICAC Act).

This decision has serious implications for past and future corruption investigations and inquiries.

It is an interesting lesson in statutory interpretation, will have relevance to similar legislation and investigating bodies in other jurisdictions and highlights the uncertainty of the term 'adversely affects'.

Facts

ICAC was investigating allegations that Ms Cunneen, a Deputy Senior Crown Prosecutor, counselled her son's girlfriend to pretend she had chest pains to prevent police officers from obtaining evidence of her blood alcohol level at the scene of a motor vehicle accident. Ms Cunneen's conduct was not being investigated for the effect it might have on her official functions as a Crown Prosecutor.

Section 8(2) of the ICAC Act provides that "corrupt conduct" is conduct of any person (whether or not a public official) that:

adversely affects, or could adversely affect, the exercise of official functions by any public official; and

which could involve specified matters, including "perverting the course of justice".

Ms Cunneen argued that the alleged conduct did not satisfy the definition of corrupt conduct under section 8(2) and ICAC was acting beyond its powers.

The Decision

The High Court (French CJ, Hayne, Kiefel and Nettle JJ, with Gageler J dissenting) held that corrupt conduct under s 8(2) means conduct that adversely affects, or could adversely affect, the exercise of an official function by a public official in one of the following ways:

the dishonest or partial exercise of a public official's official functions;

a breach of public trust; or

the misuse of information or material a public official has acquired in his or her official functions.

The Court held that the definition of corrupt conduct in s 8(2) was concerned with the probity, or integrity, of the exercise of official functions. It rejected ICAC's argument that s 8(2) would be satisfied where conduct could adversely affect the efficacy, or effectiveness, of the exercise of official functions. The Court considered that ICAC's construction was too broad and would, if correct, extend to areas that have nothing to do with the ordinary understanding of corruption in public administration.

The High Court gave ten pointed examples of what ICAC's broad construction would capture:

a public authority relying on the advice of a fraudulent stockbroker;

a thief stealing a public authority's garbage truck;

lying to a police officer;

an employee of government contractor (say, a computer software contractor) embezzling funds from the contractor;

any form of state tax or revenue evasion;

currency violations;

bankruptcy and company offences;

harbouring a criminal;

unlawful killing of a public official or violence against a public official (even if wholly unrelated to the official's status or duties); and

all forms of treason.

Note: one or more of the examples are relevant to investigations and inquiries that ICAC has commenced in recent times.

Why is it important

This is the first review of ICAC's powers by the High Court. The decision has significant implications for ICAC's jurisdiction and its powers to investigate corrupt conduct. ICAC may have to reconsider the scope of future investigations and inquiries.

The decision also has the potential to impact past and current ICAC inquiries. Previous findings of corruption made by ICAC against certain individuals may be found to be invalid. For example, in Operation Acacia, ICAC made a number of corrupt conduct findings against individuals which may now be open to challenge.

ICAC has delayed the delivery of its reports in relation to Operation Credo (involving Australian Water Holdings Pty Ltd and Sydney Water Corporation) and Operation Spicer (involving payments allegedly received and concealed by members of Parliament) pending the High Court's decision. ICAC may also need to reconsider any findings of corruption in relation to these inquiries.

There may be an issue as to whether the entirety of an investigation has been undermined if it has included matters within ICAC's jurisdiction and matters that, following the High Court's decision, it had no power to investigate – as they say, "fruit of the poisoned tree".

Because of the High Court's approach to statutory interpretation, the decision may well have implications for similar legislation and investigation bodies in other jurisdictions.